1. Field of the Invention
The present invention relates generally to the provision of credit or loans to a consumer for engaging in credit-based transactions and, in particular, to a method, system and apparatus for providing a variable credit account to a consumer via a variety of communication methods, such as the telephone, electronically, by mail and at an in-store location.
2. Description of Related Art
In order to enable convenient purchases of goods and services by consumers, the financial service industry has developed many alternative payment methods that allow a consumer to engage in a transaction and receive goods and services on credit. For example, such alternative payment methods may include checks, ATM or debit cards, credit cards, charge cards, etc. In addition, these credit vehicles are able to be used on many platforms and via many communication methods and processes. For example, a credit or charge card may be used over the telephone, by mail order, electronically over the Internet or at an in-store location. The benefit of existing payment methods allow a consumer to move the point-of-sale (POS) from an in-store location to one's home. For example, a consumer may place an order from a catalog over the telephone and use a credit card or charge card to pay for the goods and/or services. A similar process can be used for mail orders.
Virtual commerce and the growth of the Internet as a medium for commerce have placed pressure on the payment options discussed above with respect to both convenience, transaction security and the profitability by the credit issuer. However, the consumer's convenience is paramount, and the Internet provides yet another POS, or option, to the consumer for purchasing goods and/or services via an alternative medium.
The consumer lending industry or credit issuer presently spends large amounts of money in hopes of successfully soliciting a consumer or customer to use a specific credit or loan vehicle, such as a credit card or charge card. Further, the consumer lending industry directly mails credit card offers to consumers at roughly fifty-cents per offer. Therefore, performing this marketing process through the mailbox can be costly. The consumer lending industry may also offer a credit card or charge card at an in-store location as the POS. While this is an available format, many consumers do not wish to engage in applying for a credit card at the in-store location, instead typically choosing to take the offer home and completing the application there. General utility credit cards have been offered on a limited basis at the in-store locations. While the industry has attempted to use this vehicle, the industry has suffered large monetary losses due to the inability to rate or index the consumer in a real-time basis. Therefore, the large quantity of offers for credit cards and similar credit accounts occurs through the mail.
Soliciting consumers to sign up for a credit card through the mail is not only costly, as discussed above, but the characteristics of the target or possible consumer is unknown ahead of time. This means that the vast majority of the mailed offers are never applied for or, in most circumstances, even read by the consumer. In part, this is due to the fact that just because one receives mail does not mean that he or she is the primary shopper or a target consumer in any case. Therefore, the consumer lending industry has just incurred a fifty-cent loss through untargeted marketing.
Credit accounts, otherwise known as loan programs, are regulated products by the United States government. Specifically, the government has various regulations directed to offers by credit issuers to the consumer over the telephone, by mail, over the Internet and at an in-store location. Therefore, the variance in regulation poses a specialized set of problems to the consumer lending industry. There are normally two categories of loans, namely, an open-ended loan vehicle, such as a credit card, and a close-ended loan vehicle, such as a typical non-rechargeable loan, e.g., a car loan.
According to the regulations, an open-ended loan, such as a credit card offer, cannot be conducted over the telephone. This appears to be the case since the consumer must fully understand the terms, conditions and services offered by the credit issuer prior to engagement, which is not easily transmittable or conductible over the telephone. Specifically, such credit card offers are typically in writing, thus allowing the consumer to read, fully understand and agree to the terms and conditions of the credit card or credit issuer. Therefore, the credit issuer cannot offer a credit card to a consumer over the telephone, thus placing the consumer lending industry back in the same position as before, wherein the marketing exists via a writing, such as by mail, over the Internet or at an in-store location.